Budget disaster resilience spending 'falls short'
The Federal Budget has disappointed insurers on the level of resilience and mitigation spending as the Queensland and NSW flooding catastrophe highlights the long-term cost of natural disasters.
The Budget includes two $150 million annual spending tranches from the Emergency Response Fund (ERF) for recovery and post-disaster resilience, and an extra $116.4 million over three years through the Black Summer bushfire recovery grants program to support community projects.
Allianz Australia Chief Corporate Affairs Officer Nicholas Scofield says the ERF funding split between recovery and resilience for fiscal 2022-23 is not clear, but spending on resilience will “clearly fall short” of the level needed.
“When it comes to improving Australia’s resilience and adaption to increasing extreme weather events caused by climate change, the Budget is disappointing,” he said.
The Actuaries Institute says the budget emphasises significant spending on recovery over proactive investment in resilience, mitigation and adaptation measures to reduce such future outlays.
“While this is necessary in the current environment in which many Australians have very recently been impacted by natural disasters, greater investment in resilience measures is necessary for long-term sustainable impact,” CEO Elayne Grace said.
The Insurance Council of Australia (ICA) says funds announced for resilience are “an important step in the right direction” while reiterating its call for annual resilience and mitigation investment of $200 million over the next five years, matched by the states and territories.
AFAC, the national council for fire and emergency services says a $1.7 million commitment to the National Resource Sharing Centre will assist in providing coordinated responses.
“Disasters know no borders, and this additional funding will allow the states and territories to collectively respond to escalating disasters, whenever and wherever they occur,” AFAC CEO Rob Webb said.
In other areas, ICA welcomed a $9.9 billion investment over 10 years to boost the nation’s capacity to prevent and respond to cyber threats, after highlighting the issues in a report released on Monday.
The budget also included a $2.5 million commitment over two years to keep the Financial Rights Legal Centre’s Insurance Law Service in operation.
Financial Rights Legal Centre CEO Karen Cox says the funding has come at a critical time as rising demand for assistance has been outstripping the service’s ability to respond. The funding will enable the service to rebuild and grow its specialist legal team.
“The Insurance Law Service assists thousands of Australians to understand complicated insurance products, navigate claims and resolve disputes often during times of great distress,” Ms Cox said. “It is vital that the work of the Insurance Law Service continues and the skills and experience of its specialist solicitors is not lost.”
Treasurer Josh Frydenberg said in handing down the budget last night that “total support to families, farmers small businesses, local governments and their communities is expected to exceed $6 billion” following the Queensland and NSW flooding disaster.
The budget papers show more than $1.1 billion already paid to over 1.3 million people as of March 24.
